I needed this feature last night. I downloaded a YES album from itunes, when i was in bed with my ipod touch 4G. The problem is I listen to my music in my bedroom, streaming over an Airport Express, as I have 350GB of music. I could have connected a cable via my ipod touch 4G, but it was late at night plus the quality isn't as good as my outboard DAC (connected optically to the Airport Express of course). With Airplay I can stream the music on my ipod touch thru the Airport Express.
2. Midi Support
My Palm Tungsten had this feature. I could use a sequencer from my Palm connected to my Yamaha TG300 Tone Generator and then use its Midi Thru for other non RS232 synths. Finally the ipod Touch 4G can do everything my Palm used to do (Including a physical keyboard). The only thing I miss is the instant on the Palm could do (The ipod touch takes 15 seconds to boot LOL).
Check out my Palm being used as a sequencer on Youtube.
More from me Later...